Recessive Environment

Sales Strategies to Succeed in aRecessive Environment

Presented by: John AsherChairman and CEO

ASHER Strategies, Inc.

1

Sales Strategies

• Strategic:– CEO Decisions

• Tactical:– VP Sales Decisions

ASHER | GLOBAL LEADERS IN SALES STRATEGIES 2

Four Strategic Decisions

• Consolidate– Acquire/merge with other companies

• Focus on current customers– Give them increased attention from top level managers– Formalize your customer feedback process

• Make strategic hires– Talent is more important than ever– The pool of available talented people is larger than ever

• Increase your spending on professional development for highly effective people


M&A Action Steps

• Identify the weakened competitors– Let them fail; grab their business, or– Acquire them at a great price

• Consolidate– Cut back office costs– Offer consolidation (in a geographical

area)

• Use Private Equity (PE) firms to fund• Use Vistage resources to identify

potential targets/partners/PE firms


Case Study – Arrow Electronics

• 1973 - 1975 Recession (US National GDP dropped by 3.1%)– Arrow Electronics acquired Kay Electric Supply Company

• 1982 Recession (US National GDP dropped by 2.9%) – Arrow Electronics acquired Computrend, Computer Products Supply

Co., and High Technologies Distribution

• 1990s recession, – Arrow used funding from private equity transactions to buy several of

their competitors including their rival, Schweber Electronics


Case Study – Arrow Electronics (continued)

Arrow Electronics is now the biggest electronic components distributor in the US


Focus on Current Customers

• Give them attention from top executives and managers

• Formalize your customer feedback processes

• Use Vistage Resources to develop the customer feedback process


Best Practice CustomerFeedback Process

• Conduct a formal feedback session with continuing customers– Every six months– After a major deliverable


• Face-to-face with the 20% that give you 80% of your business– Phone with the rest

Best Practice In-Office Customer Feedback Questions

1. What do we do well?2. What could we do better?3. On a scale of 1-10, how likely is it that you would recommend

us to your friends and colleagues?4. What are your biggest current problems?5. What kinds of requirements will you have in the near future

to which we could respond?6. Are there other organizations who could use our

services/products? Would you introduce us?- International Benchmarking Institute


Case Study: How General Electric Uses Customer Feedback

• Answers to Customer Feedback question # 3 are categorized as:

• The percentage of detractors is subtracted from the percentage of promoters to give a:

Net Promoter Score (NPS)


0-6 Detractors

7-8 Passives

9-10 Promoters

GE Customer Feedback Example

• The Net Promoter Score (NPS) = 20%


Customer Score Category

A 7 Passive

B 5 Detractor

C 9 Promoter

D 8 Passive

E 9 Promoter

F 6 Detractor

G 7 Passive

H 9 Promoter

I 10 Promoter

J 8 Passive

Category Percentage

Promoter 4 (40%)

Passive 4 (40%)

Detractor 2 (20%)

NPS = 20%

What GE Does With The Results

• Across all GE businesses, the highest NPS scores have the highest margins– The lowest have the lowest

• If any business unit gets an NPS score of less than zero, immediate action is taken to discover the reasons and fix it


Best Practice In-Office Customer Feedback Questions

1. What do we do well?2. What could we do better?3. On a scale of 1-10, how likely is it that you would recommend

us to your friends and colleagues?4. What are your biggest current problems?5. What kinds of requirements will you have in the near future

to which we could respond?6. Are there other organizations who could use our

services/products? Would you introduce us?- International Benchmarking Institute


Make Strategic Hires

• Bigger Pool of available people– One of seven outside hunter

salespeople are now available

• Talented senior people from large companies are suddenly available– They can bring big company thinking

to your company


• Use Vistage recruiting firms to find them- Bureau of Labor Strategies

Increase the Spending on Professional Development

• Usually one of the first costs to be cut– May help in the short term– You will pay for it in the long term

• Highly leveraged professional development– Sales Training– Product Training– Internal Coaching Programs

• Vistage offers resources in these areas


Tactical Decisions

• Focus on the customers who can buy your products

• Look to new markets where your products are a potential fit

• Improve the referral process

• Rebalance the sales force


Focus On The Customers Who Can Buy Your Products

• Organizations somewhat insulated from the current financial and credit crises– Health care– Energy

• Organizations who are “cash rich”– Government– Government contractors

• Bigger customers

– Usually more financially stable

– Smaller companies are at the end of the “food chain”

• Companies who are desperate for help – Car dealerships


Explore New Markets

• Look to new markets where your products are a potential fit– It is usually difficult to enter new markets

• But “chaos equals opportunity”– Everyone is looking for new and innovative solutions from anywhere


Improve The Referral ProcessGaining Initial Contact With the Prospect

Introductions or referrals……..………………………..48%

Organizations and associations ……………………..42%

Trade shows and events …………………………………41%

Viral/Word-of-Mouth …………………………………….36%

Direct Mail………………………………………………………34%

Telemarketing …………………………………………………27%

Email campaigns……………………………………………...27%

Website ……………………………………………………………24%

Channel Partners………………………………………………23%

Advertising ……………………………………………………….21%

Search Engine Optimization………………………………16 %


The Problem with Referrals

• Average Salespeople never ask for referrals– It takes 12 contacts to make a sale

– Average salespeople make 3 and move on

– None of the referrals ever close

– Their minds became conditioned to think that referrals “just do not work” and they quit asking for them

• 87% of referrals are never pursued


Top Salespeople always Ask

• 54% of all qualified referrals that are properly pursued eventually buy

• Sales that result from referrals from existing clients have a 92% retention rate

• Top Salespeople:– Always ask for referrals

– Always pursue them until they “buy or die”


Best Practice Referral Follow-up Process

• Turn the referral source as your “coach”

• Use the “coach” to help qualify the referral

• Use the “coach” to – Send an introductory email

– Set up an introductory conference call

– Set up an introductory meeting

– Set up a meal (breakfast/lunch/dinner)

– Set up a golf game/ sports event/social event


Rebalance the Sales Force• Segment the sales force into “A”, “B” and “C” players

– Increase concentration on the “A” group• Coaching can increase sales by up to 20%

– Immediately cut the “C” group

– Determine the potential of the “B” group with a sales aptitude assessment• Cut the ones with a low sales aptitude and poor results


Audit the Sales Force• See where your sales group stands with the Best Practice Five Factors for

Sales Success


– Product Knowledge

– Sales Aptitude

– Sales Skills

– Motivation

– Sales Processes

The Five Factors forSales Success

Product Knowledge (Made)

Sales Aptitude (Born)

Sales Skills (Made)

Motivation (Made)

Sales Processes (Made)


50% of sales results

Knowledge is Power

“The quality of a person’s life is in direct proportion to his/her commitment to excellence, regardless of the chosen field or endeavor”

Vince Lombardi





Sales Skills (Made)

Motivation (Made)




The Great Salespeople


BORNOR

MADE?

Sales Aptitude(Bell Curve)

ASHER | GLOBAL LEADERS IN SALES STRATEGIES

60%(Moderate)

20%

0 30 40 50

20%(Low)

27

20%(High)

Sales AptitudeCase Study: MetLife

ASHER | GLOBAL LEADERS IN SALES STRATEGIES

60%(Moderate)

20%

0 30 38 40 50

20%(Low)

27

20%(High)

MetLife

Case Study of Three Distributors(Building Products Industry)


Company % of Sales Force with High Aptitude Growth Rate in 2006

Company A 90% 70%

Company B 30% 30%

Company C 10% 4%




Sales Skills (Made)

Motivation (Made)




The Top-Ten Skills of theSuper Salespeople


The Top-Ten Sales Skills CONTINUED


The Top-Ten Sales Skills CONTINUED


7. Recognize when buyers are ready to buy (Buyer’s Shift)

8. Know how to close the sale

9. Build long-term relationships with prospects and customers by providing superb customer-care/account management services

10. Ask for referrals and use a process to follow up on them




Sales Skills (Made)

Motivation (Made)




Highly Motivated Salespeople• Are on “the right seat on the bus” based

on natural sales aptitude

• Have a great manager/mentor or coach who helps them “stretch” from their natural talent

• Have the needed training– Product Knowledge

– Selling Skills


• Have the right tools to be successful– Labtops, mobile devices, software

• Work in companies with great sales processes to support them




Sales Skills (Made)

Motivation (Made)




Sales Processes (OBJECTIVES)

• Branding (Raise Market Awareness)– So when an “unqualified” lead becomes “qualified”, they contact you

• Marketing – Get qualified leads

• Sales– Given a qualified lead, make the contacts necessary to close the sale

– 12 contacts needed to make a typical B2B sale

• Account Management / Program Management / Customer Care– Once you have the customer, execute flawlessly


Vistage Expertise

• Many Vistage resources offer help with these five factors:– Product Knowledge

• E-Learning

– Sales Aptitude• Aptitude Assessments for Selection and Development

– Sales Skills• Sales Training

– Motivation• Coaching/Mentoring

– Sales Processes• Sales Process Workshops


Strategic Action Summary

• Buy/merge with weakened competitors

• Update your customer feedback process

• Make strategic hires

• Increase spending on professional development for the top performers


Tactical Action Summary

• Focus on the current customers who can buy your products

• Look for new markets

• Improve the referral process

• Rebalance your sales force


Sales Strategies

• Strategic:– CEO Decisions

• Tactical:– VP Sales Decisions

Vistage offers robust resources in all areas.


Asher Strategies(A Vistage Resource)

• Sales aptitude assessments• Sales training• Sales Process Improvement workshops

Contact:Kyla O’ConnellExecutive Vice President Asher StrategiesPhone: (410)-299-3306Email: [email protected]: www. Asherstrategies.com


mailto:[email protected]

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Recessive Environment